Recorded RBI impact
License cancellation
License cancellation · Fresh imposition
Published by RBI
10 Jan 2003
Case Brief
RBI cancelled, on December 17, 2002, the Certificate of Registration issued to Merbanc Financial Services Limited, Hyderabad, under Section 45-IA of the RBI Act, 1934. The company was therefore no longer permitted to transact business as a non-banking financial institution. RBI also prohibited the company from accepting deposits under Section 45MB(1) and from alienating assets under Section 45MB(2), while noting that it must continue to repay public deposits in accordance with the deposit contract terms.
Why RBI Acted
In exercise of powers under Section 45-IA of the RBI Act, 1934, RBI cancelled the Certificate of Registration issued to Merbanc Financial Services Limited on December 17, 2002 for carrying on the business of a Non-Banking Financial Institution. Following the cancellation, the company was prohibited under Section 45MB(1) from accepting deposits and under Section 45MB(2) from alienating assets, though it remained obligated to repay public deposits according to contractual terms.
Operating Impact
Merbanc Financial Services Limited must stop NBFC საქმიან? operations immediately and cannot accept fresh deposits or transfer/alienate assets. Public depositors remain entitled to repayment as per contract terms, and the restriction directly affects the company’s operations and counterparties.
Regulatory Basis
- Section 45 IA of the Reserve Bank of India Act, 1934
- Section 45MB(1) of the Reserve Bank of India Act, 1934
- Section 45MB(2) of the Reserve Bank of India Act, 1934
Action Facts
- Primary Impact
- License cancellation
- Order Date
- 17 Dec 2002
- Effective From
- 17 Dec 2002
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- NBFC